It looks like the government are up to no good, and I'm afraid it looks like they are trying to hide (or at least obscure) how much of the government is going to be funded by 'printing money'. As you will see, as I run through the situation, it all gets more than a little odd.

Since writing my last post on the bankruptcy of the UK government, I came across a different story in the Times:

The Bank of England will begin radical moves to “print money” in as little as two weeks as it embarks on an aggressive new phase of its efforts to stem the economic slump.

In a surprise acceleration of its fight against the recession, it emerged that the Bank has already written to Alistair Darling to seek his permission to begin so-called “quantitative easing”.

If you read the article, there is clearly a sense of urgency coming through. When Quantitative Easing (QE) was originally proposed, it was suggested that March would see a start. This is replicated in the current article, but there is a sudden sense of urgency. Why?

However, the reason for my returning to the subject is this, from the same Times article:

With the Chancellor expected to give a rapid green light to the scheme, the modern equivalent of printing money, the MPC will deploy the cash that it plans to create to buy up company IOUs and other assets held by Britain's banks, including gilts [Bonds] previously issued by the Treasury.

'Charlie Bean [the Bank of England Deputy Governor] put his weight behind the pound's 25pc fall over the past year in an unusual comment on the pound. Mr Bean also confirmed that the Bank is poised to start buying government bonds in a drastic attempt to resuscitate the stricken economy.'

As you will note, the Telegraph article implies that the bank will buy bonds (gilts) directly but the Times suggests that the BoE will buy gilts from banks, not in direct auctions by the UK Debt Management Office.

The interesting thing to consider is that the banks are now in the pocket of the state, so a deal where the banks sell the BoE gilts, then the banks replace these with newly auctioned gilts looks a realistic way of burying the BoE's buying of the gilts overall. The banks can just keep buying the gilts and selling them on to the BoE, whilst the bank holding of gilts remains relatively static.

But the MPC could also influence the economy by controlling the quantity of that central bank money directly. Increasing the supply of central bank money in the economy through additional purchases of government securities should raise private sector spending, both directly (through the increase in money holdings of private sector asset sellers) and indirectly (through an expansion by banks of the supply of credit).

You will notice that all of this is a bit vague and not too clear at all.....I conducted a search on the BoE website, to see if I could find any details under a search for 'quantitative easing' and found no results which offered any more detail on their policy, and how it will be conducted. My search is linked to here (the search was made 19th February, and may change if new material is added by the BoE).

This is rather curious, in light of the fact that the BoE is about to be creating £billions of money (printing money). I would have thought that, with the country in an economic crisis, the BoE might offer something about what it is planning? I mean, they are about to embark upon an action that, even amongst their own economists, is surely seen as drastic. And no details....??? Surely such a dramatic move would have a dedicated and detailed outline of the action and policy....

However I did find this document, which is Mervyn King talking to the press. A Financial Times reporter points out that the BoE February 2009 inflation report is a 'bit waffly' on the subject of quantitative easing, and refers to the BoEs discussion on pages 44-45. Inevitably, I took a look at this section. I found the following quote (the APF referred to is the Asset Purchase Facility which was granted to the BoE in January to buy up to £50 billion of financial assets):

In such circumstances, purchases by the APF would be financed by the creation of central bank reserves. This approach to monetary policy would continue to exploit the Bank’s position as monopoly supplier of reserves. But instead of focusing on reducing the price of those reserves — as now — the MPC would focus on expanding their quantity, using the proceeds to purchase a range of financial assets, for example government securities and the private sector assets targeted by the current APF

The FT reporter is quite correct, in saying that it is waffly. In response to the FT reporter's comment, Mervyn King points out that the BoE has always purchased gilts as part of open market operations. However, this is entirely a distraction and not of any relevance. He goes on to say the following:

What we now will be moving to is a world in which, again, we will be buying a range of assets, but certainly including gilts, in order to ensure that the supply of money, initially base money, but the impact is on the broader supply of money - that's what matters - in order to ensure that the supply of money will grow at an adequate rate to keep inflation at the target, and that normal rates of economic growth can resume.

Are we any the wiser as a result of this response? I would say not. He later adds even more confusion by mixing together the APF with buying gilts in normal open market operations, and the general purchasing of gilts, and QE measures.

And that I think is the essence of the operations. Now we've already announced a variant of that, which I think is a more unconventional approach. I mean, what I've just described, which is central banks buying government assets in order to ensure that either the overnight rate or the monetary base are consistent with their target for inflation, those are very conventional activities and they've been going on for decades. And that's why I called these - in my speech recently - I called these activities conventional unconventional measures.

Here he is suggesting that QE is comparable with normal central bank operation, whilst at the same time saying it is not! Followed later by:

As a result I think we think these operations, which I call unconventional conventional measures, and the more conventional ones - buying gilts - are a natural partnership; they go together. And I would see us operating on both of them.

You may notice that there is no mention of how the gilts will be purchased here. We are still none the wiser as to how the operation will be conducted.

A Bloomberg reporter also later presses Mervyn King on the issue, and on transparency, and independence of the BoE. Again, the answer is waffling. Mervyn King goes on to say:

If we were to get to a point and we may well when the Monetary Policy Committee feels that it would like to create Central Bank money to finance purchases of assets, whether it's gilts or whether it's further credit easing operations then a resolution will
be put to the Monetary Policy Committee after a discussion and the Monetary Policy Committee would vote on the operations it wanted to carry out. And it would then delegate to the Executive as now the actual authority to carry out the operations itself to deliver that impact. And the minutes would come out at the normal time and would reveal what the Monetary Policy Committee had decided to do. [my italics]

If you look at the minutes, and the form of the minutes, there is no obligation to provide any detail on what will be done. The minutes are meaningless as a reporting instrument - and they are not designed as such. They are there to show the overall policy decision, not implementation and detail. As such, there is no mechanism for reporting what will actually be done, or how.

Just to add to the worries, Mevyn King later admits that the the BoE will be coordinating with the government's Debt Management Office:

But it's clear the Central Bank has to work in a way that the Debt Management Office, or the funding operations of government are not working at cross purposes, they have to work together. That is the only difference I can think of. But there is certainly no compromise at all of the operations of the independent Central Bank. And we will be just as independent as the Federal Reserve.

In other words, the government and the BoE are going to be working together. I am genuinely puzzled as to what these 'cross purposes' might be, in light of the explanations of why QE is being undertaken. It seems simple - the BoE buys assets to inject more money into the money supply....what coordination does that require? They later give a very vague answer to this, that never deals with the specifics.

In a later reply to a BBC question we get a little closer to an explanation (of which I am very dubious) of why gilts are being purchased, which hints at direct purchase, but is still unclear:

Well I think what we're doing in terms of our buying government gilt is to reduce the net purchases which the private sector have to make of those instruments. And that is the essence of under funding. So provided the Debt Management Office keeps its
sales of gilt the same, if we then buy them and create Central Bank money that will reduce the size of purchases that will have to be made by the non-bank private sector.

In a reply to the Economist, Mervyn King later gives a hint of the potential scale of Gilt purchases:

[...] order to increase the supply of money overall by an appropriate amount to top that up by actually making potentially significant purchases of gilts. [my italics]

Interestingly, the Economist journalist was having difficulty in untangling the APF from ordinary operations from forthcoming QE measures. I find it a little worrying that none of the journalists even asked how much money might be printed, how it might specifically be used, and what the operation of purchase of assets will be. This perhaps explains the difference between the reports in the Times and Telegraph.

The problem is that, throughout the whole press conference, there is absolutely no detail on how much money will be created, what assets will be purchased and how they will be purchased. I did find one other document, but it offered even less clarity.

What we therefore have is a situation in which the BoE is going to print unspecified amounts of money with no clear policy statement, no detail on either how or what they will buy, and with no formal system for reporting on this.

Does this not seem odd to you?

Meanwhile, in the comments section of my last post I added my own comment and linked to this news:

The U.K. government-bond market is set for its biggest overhaul in more than a decade amid concern that buyers could be swamped by a huge increase in issuance.

The expected changes would overhaul the 300-year-old system of auctioning the bonds, known as gilts, to specialist market makers employed by banks. They could instead open up the gilt market directly to investors such as pension funds.

I like the words 'such as' which I have highlighted here, which are suitably unclear. By strange coincidence, this change will allow the BoE to make direct purchases......A funny coincidence perhaps?

The problem here is that the government has got form on this kind of odd behaviour, but were 'found out' last time. This is the matter of the BoE not having to publish the amount of money that it creates. I will quote my post on the subject.

It is for this reason, I suspect, that the Bank of England is planning to print money, and the same reason why they changed the law in the banking in an Act of this year as follows:

The act can be found here, and the relevant section is on page 115. Here are the words from the original act of 1844 that has been repealed (to be found on the first page of the pdf copy on the BoE website):

6 Weekly account in form in schedule (A.) to be rendered by the Bank of England
… An account of the amount of Bank of England notes issued by the Issue Department of the Bank of England, and of gold coin and of gold and silver bullion respectively, and of securities in the said issue department, and also an account of the capital stock, and the deposits, and of the money and securities belonging to the said governor and company in the banking department of the Bank of England, on some day in every week to be fixed by the [Commissioners for Her Majesty’s Revenue and Customs], shall be transmitted by the said governor and company weekly to the said commissioners, in the form prescribed in the schedule hereto annexed marked (A.), and shall be published by the said commissioners, in the next succeeding London Gazette in which the same may be conveniently inserted.

Essentially, it now possible for the Bank of England to print money and not tell anyone about it. I was originally made aware of this on the Guido Fawkes blog here. I have previously quoted several reports that there have been problems for the government in raising finance.

It all looks painfully familiar. In one case, a little clause in an act so that they do not have to tell people how much their printing in a change to a very old act, and now changing a 300 year old system. It seems that, as if by magic, modernity is finding its way into the system.....

As regular readers will know, I am not very positively inclined to conspiracy theory. However, what we have is two significant changes in the financial system which also happen to be very useful for the hiding of mass direct purchase of government debt. These changes happen to be happening at a time of financial crisis, at a time when the government is running up a debt mountain, and when the £GB is falling like a stone and likely to scare off overseas investors....

...and quantitative easing will be taking place with no publicly available formal policy document, with the sole reporting being the MPC minutes.

You may note that I am, to say the least, rather suspicious.......

One other thought keeps nagging me.

Why the urgency? If this policy is not an act of desperation, why must it be done right now....?? I mean, what difference would a few weeks make? An economy normally takes about a year to respond to interest rates= changes, for example??

Your research is well apreciated: amazing in fact. Most details here relate to U.S. economy but the 'British' disease of secrecy makes it hard for me to read between the lines. This looks like it will end in tears.

I only wish I was the author, because his thinking is so clear and concise! I keep leaving the links with his work yet the confusion abounds. He really is an excellent companion to this site, however, I can't find anything that quite hits every combined facet that Chris Martenson can with the Crash Course over in the UK, so this is why I wander the threads 'In Search Of' enlightenment here, where there must be the sum of 80% American input.

This is awkward when you have to stand some points on their head to swap them over to the UK perspective and, this is why I figured other Anglophiles here might be feeling the same way; hence 'Cynicus Economicus'.

...I find the internet is chock full of ripe and juicy fruit. Sadly, it's cheek-by-jowel with acres of un-sift-able crap that you have to pick through with dirty fingernails to fullfill your point of being there.

All I can add here is that you should take a full and cleansing breath and plunge into the deep-end of Cinicus' work from about the 8 months ago marker, and forward. Bring valium-canabis-uppers-downers-ludes-reds-greens-screamers-three sheets of high-powered blotting paper-cigarettes-rubbing alcohol and sipping vinegar, along with tea bags, a stove, a months supply of 'munchies'- beans-rice, a pot to boil them in and a pot to piss in, and hunker-down; coming up red eyed and clued up in a months time, like I did!!!

Thanks for posting these links to 'cynicuseconomicus', they give us UK residents an in depth look at the shenanigans going on in the financial world closer to home. This last link is really a great piece of investigative journalism.

I keep coming back to the question of how intelligent people aren't seeing the writing on the wall. Sure the future is uncertain, but so few people seem to realise (or want to realise) that our current lifestyles are unsustainable and things will have to change hugely sometime soon. Actually I might have a tentative answer to this, I asked a friend once how intelligent people could fail to see basic facts and he replied, 'The Archbishop of York is an intelligent person, but he still has an imaginary friend'. I guess its not about intelligence, its about agendas, power and denial.

Thanks for those links. Wikipedia certainly is an amazing fountain to drink from!

If I'm honest with myself and get beyond the irritation, I can see (in part anyway) why people are not keen to complete the CC etc. There are lots of interrelated reasons, but in essence I think that if you face the implications of the CC it means everything will change. Not too apetising, particularly because as a species we assume the future will look something like the past. That makes it hard to act now for uncertain and unfamiliar outcomes in the medium to long term future. The draw of the 'now' and short term is ever strong. Most people (me too) look as far as the weekend or next month and its hard to go beyond that. So I'll keep plugging away encouraging (some might say 'boring') people to consider peak oil etc and make my own preparations in the meantime.

On a different note, I take it '451' is a reference to Ray Bradbury's novel? I read it as a kid but was too young to get the political implications of it. I just searched it on Wiki (my turn now) and I realise I should re-read it. So thanks for that.

And 'What a nightmare!' is just that! It will scare people. Have we got any carrots to use as well as sticks? Something like 'Permaculture is cool, fun & sexy'...I know DTM will argue all those and I don't doubt it (well maybe the last a little), but we need to offer a better alternative to the present if we change and not just a bleaker future if we don't.

I thought about the reply you gave me over the last couple of days and finally hit upon page 26 of James Howard Kunstler' and a book you should read (if you haven't?) called, 'The Long Emergency'. This is the passage I had in mind :-

" ... How could such a catastrophe be so close at hand and civilized, educated people in free countries with free media and transparent institutions be so uninformed about it? I am not one for conspiracies. While they have happened in history, conspiracies almost invariably have to be very small, and limited to tiny circles of individuals. Human beings are not very good at keeping secrets; individual self-interest is not interchangeable with group interest and the two are often in conflict, most particularly among small groups of plotters. I do not believe that the general ignorance about the coming catastrophic end of the cheap-oil era is the product of a conspiracy, either on the part of business or government or news media. Mostly, it is a matter of cultural inertia, aggravated by collective delusion, nursed in the growth medium of comfort and complacency. Author Erik Davis has referred to this as the "consensus trance".

When we think about it all, most Americans seem to believe that oil is superabundant, if not limitless. We believe that the world is full of enormous amounts of as-yet-undiscovered oil fields, and that "new technologies" for drilling and extraction will perform prodigious miracles in extending the life of existing fields. For many of us, even people who ought to know better, the thinking stops here. The oil corporations know better but they also know that bad news is bad for business, and because there are no ready substitutes for oil they decided to soft-peddle the news about world peak. Either that or they put a smiley-face spin on the situation. British Petroleum (BP) recast itself "Beyond Petroleum" in order to gain points for social responsibility without really changing anything it does.

Collin Cambell, an oil geologist who has worked for many of the leading international oil companies, including BP, put it this way:

The one word they don't like to talk about is depletion. That smells in the investment community, who are always looking for good news and the image, and it's not easy for them to explain all these rather complicated things, nor indeed do they have any motive or responsibility to do so. It's not their job to look after the future of the world. Their directors are in the business to make money, for themselves primarily and for the shareholders when they can. So I think it's certainly true the oil companies shy away from the subject, they don't like to talk about it, and they are very obtuse about what they do or say about it. They themselves understand the situation as clearly as I do, and their actions speak a lot more than their words. If they had great faith in growing production for years to come, why did they not invest in refineries? There are very few new refineries being built. Why do they merge? They merge because there's not room for them all. It's a contracting business. Why do they shed staff, why do they outsource people? BP aims to have 30 percent of its staff on contract. This is because it doesn't want long-term obligations to them. The North Sea is declining rapidly. They don't like to say so, but I think only four wildcats were drilled there this year(2002). It's over! It's finished! And how can BP or Shell and the great European companies stand up and say, well, sorry, the North Sea is over? It's a kind of shock they don't wish to make. It's not evil, or there's no conspiracy, or anything. We live in a world of imagery and public relations and they do it fairly well, I'd say. "

........................

This is in itself a useful tool in explaining to your friends and family exactly why they are finding the facts so difficult to digest.

Another piece of catastrophic news that went by quietly in the Guardian Newspaper back on the 15th December 2008 was this interview by George Monbiot with Fatih Birol, chief economist of the International Energy Agency (IEA). I'd watch the video after reading the article here by clicking the link below :-

" Can you think of a major threat for which the British government does not prepare? It employs an army of civil servants, spooks and consultants to assess the chances of terrorist attacks, financial collapse, floods, epidemics, even asteroid strikes, and to work out what it should do if they happen. But there is one hazard about which it appears intensely relaxed: it has never conducted its own assessment of the state of global oil supplies and the possibility that one day they might peak and then go into decline.

If you ask, the government always produces the same response: "Global oil resources are adequate for the foreseeable future." It knows this, it says, because of the assessments made by the International Energy Agency (IEA) in its World Energy Outlook reports. In the 2007 report, the IEA does appear to support the government's view. "World oil resources," it states, "are judged to be sufficient to meet the projected growth in demand to 2030," though it says nothing about what happens at that point, or whether they will continue to be sufficient after 2030. But this, as far as Whitehall is concerned, is the end of the matter. Like most of the rich world's governments, the UK treats the IEA's projections as gospel. Earlier this year, I submitted a freedom of information request to the UK's department for business, asking what contingency plans the government has made for global supplies of oil peaking by 2020. The answer was as follows: "The government does not feel the need to hold contingency plans specifically for the eventuality of crude-oil supplies peaking between now and 2020."

So the IEA had better be right. In the report on peak oil commissioned by the US department of energy, the oil analyst Robert L Hirsch concluded that "without timely mitigation, the economic, social and political costs" of world oil supplies peaking "will be unprecedented". He went on to explain what "timely mitigation" meant. Even a worldwide emergency response "10 years before world oil peaking", he wrote, would leave "a liquid-fuels shortfall roughly a decade after the time that oil would have peaked". To avoid global economic collapse, we need to begin "a mitigation crash programme 20 years before peaking". If Hirsch is right, and if oil supplies peak before 2028, we're in deep doodah.

So burn this into your mind: between 2007 and 2008 the IEA radically changed its assessment. Until this year's report, the agency mocked people who said that oil supplies might peak. In the foreword to a book it published in 2005, its executive director, Claude Mandil, dismissed those who warned of this event as "doomsayers". "The IEA has long maintained that none of this is a cause for concern," he wrote. "Hydrocarbon resources around the world are abundant and will easily fuel the world through its transition to a sustainable energy future." In its 2007 World Energy Outlook, the IEA predicted a rate of decline in output from the world's existing oilfields of 3.7% a year. This, it said, presented a short-term challenge, with the possibility of a temporary supply crunch in 2015, but with sufficient investment any shortfall could be covered. But the new report, published last month, carried a very different message: a projected rate of decline of 6.7%, which means a much greater gap to fill.

More importantly, in the 2008 report the IEA suggests for the first time that world petroleum supplies might hit the buffers. "Although global oil production in total is not expected to peak before 2030, production of conventional oil ... is projected to level off towards the end of the projection period." These bland words reveal a major shift. Never before has one of the IEA's energy outlooks forecast the peaking or plateauing of the world's conventional oil production (which is what we mean when we talk about peak oil).

But that is as specific as the report gets. Does it or doesn't it mean that we have time to prepare? What does "towards the end of the projection period" mean? The agency has never produced a more precise forecast - until now. For the first time, in the interview I conducted with its chief economist Fatih Birol recently, it has given us a date. And it should scare the pants off anyone who understands the implications.

Birol, the lead author of the new energy outlook, is a small, shrewd, unflustered man with thick grey hair and Alistair Darling eyebrows. He explained to me that the agency's new projections were based on a major study it had undertaken into decline rates in the world's 800 largest oilfields. So what were its previous figures based on? "It was mainly an assumption, a global assumption about the world's oil fields. This year, we looked at it country by country, field by field and we looked at it also onshore and offshore. It was very, very detailed. Last year it was an assumption, and this year it's a finding of our study." I told him that it seemed extraordinary to me that the IEA hadn't done this work before, but had based its assessment on educated guesswork. "In fact nobody had done this research," he told me. "This is the first publicly available data."

So was it not irresponsible to publish a decline rate of 3.7% in 2007, when there was no proper research supporting it? "No, our previous decline assumptions have always mentioned that these are assumptions to the best of our knowledge - and we also said that the declines [could be] higher than what we have assumed."

Then I asked him a question for which I didn't expect a straight answer: could he give me a precise date by which he expects conventional oil supplies to stop growing?

"In terms of non-Opec [countries outside the big oil producers' cartel]," he replied, "we are expecting that in three, four years' time the production of conventional oil will come to a plateau, and start to decline. In terms of the global picture, assuming that Opec will invest in a timely manner, global conventional oil can still continue, but we still expect that it will come around 2020 to a plateau as well, which is, of course, not good news from a global-oil-supply point of view."

Around 2020. That casts the issue in quite a different light. Birol's date, if correct, gives us about 11 years to prepare. If the Hirsch report is right, we have already missed the boat. Birol says we need a "global energy revolution" to avoid an oil crunch, including (disastrously for the environment) a massive global drive to exploit unconventional oils, such as the Canadian tar sands. But nothing on this scale has yet happened, and Hirsch suggests that even if it began today, the necessary investments and infrastructure changes could not be made in time. Birol told me: "I think time is not on our side here."

When I pressed him on the shift in the agency's position, he argued that the IEA has been saying something like this all along. "We said in the past that one day we will run out of oil. We never said that we will have hundreds of years of oil ... but what we have said is that this year, compared with past years, we have seen that the decline rates are significantly higher than what we have seen before. But our line that we are on an unsustainable energy path has not changed."

This, of course, is face-saving nonsense. There is a vast difference between a decline rate of 3.7% and 6.7%. There is an even bigger difference between suggesting that the world is following an unsustainable energy path - a statement almost everyone can subscribe to - and revealing that conventional oil supplies are likely to plateau around 2020. If this is what the IEA meant in the past, it wasn't expressing itself very clearly.

So what do we do? We could take to the hills, or we could hope and pray that Hirsch is wrong about the 20-year lead time, and begin a global crash programme today of fuel efficiency and electrification. In either case, the British government had better start drawing up some contingency plans. "

..................

Yet, all I have drawn together here is on the subject of oil on a page dealing with currency? You and I both know by now that much of the past 100 years has had the expansion of currency running in lock-step with oil and, there is the achilles heal...

.................

And on a lighter note, My reference to '451' is most definately from the book by Ray Bradbury and thankyou for spotting that!. It should be compulsary reading for every man woman and child because its message is as clear today and of the future as it was when it was first written. Make a point of buying :-

James Howard Kunstler - The Long Emergency

Ray Bradbury - Fahrenheit 451

...at the same time, though, as always, these are just suggestions. Both are lapping to the brim with 'Critical Thinking' - 'Cognitive dissonance' - 'Emotional Intelligence'

Here is the book burning scene from the (1966) film adaptation :-

Take Good Care,

Paul

(edit)

Chris Kresser has made a stunning thread with a transcripted speech by Dimitry Orlov. I think it speaks volumes about what is happening to the United States Of America and practically the whole world in result of this advancing Global Economic Depression. With this in mind, I'm linking this thread to his with this :-

Loved the 451 clip - terrific! The critical thinking link is interesting too. I can appreciate, and to an extent agree with, the anger at the indoctrination of our children, but I also feel that's how cultures' work. If they didn't encourage practices that sustain them, then they disappear to be replaced by those that do.

I've not read 'The Long Emergency', partly because I've assumed (probably incorrectly) that it covers similar stuff to the Heinberg books I've read. I am right on this? If so, I feel I've had enough analysis of the problem and the state we are in re. oil and want some new directions and personal solutions. In particular, I'm interested in building awareness, community and my personal practical preparation. That's one of the things I like about this site, lots of little bits of practical advice, liberally scattered with economics and all sorts oddball extras.

Even though I've a sense of how tricky things are likely to get in the future, I'm pretty relaxed about it really (maybe I just don't understand it I can hear people saying). We're just about to buy a small plot of land in Somerset and have some great, yet simple plans. Mainly trees and the beginnings of a permaculture. I've a relatively secure job and although it wont last forever, I'm hoping that the transition to a lower energy/resource level will be manageable and it won't all go to **** overnight. I've a friend who disagrees and thinks a total collapse is inevitable. He feels the whole of the CC is just the 'bargaining' stage of grief. A delusion we could better do without. What's your take?

I read the piece you posted on deflation and thought it was excellent. Shame to think CynicusEconomicus might end his blog. Not sure I fully got it though, as its so counter to everything else you read. Maybe you should start a thread asking if deflation is such a bad thing to test his arguments with the community.

thanks for the reply. It brought up many areas that I'm passionate about and I'll build upon what I feel in the best way that I can. One man that always appears to bring the past into the present with remarkable agility is Socrates. This quote brings the rest of what I'm trying to state here into some form of clarity :-

"Reform cannot be achieved by a well-intentioned leader who recruits
his followers from the very people whose moral confusion is the cause
of the disorder." - Socrates

What I'm trying to apply here is the build of 'Ulteria Motive' that is often given the monica 'Progress' or, 'For the benefit of the majority'. They are usually built upon the lines of statements by those in power or, those given an education and pedigree 'by the state' through education, to perform the tasks that 'Make Our Lives Better'.

A transcripted interview from 1997 that you can find at the bottom of the link I've placed in my 'signature' has this piece that I feel is relevant from John Taylor Gatto :-

" In Chicago, there's a black lady named Marva Collins, working with black ghetto kids, many of them with no intact families. She found out what I found later on, which was that these children have no resistance to very high level work and ideation. In a quick take, if you set the idiom aside, they're producing work of a caliber that we associate with adults. I know this must sound fantastic to your listeners, but the truth is you and I could spend hours and not come to the end of people who've accidentally stumbled on the great dirty secret of American schooling: it just doesn't teach the way children learn, nor can it be allowed to, or maybe that's just momentum and not design. We're dealing with a 6700 billion dollar a year industry - it's the gatekeeper to all of the rest of the jobs. We couldn't turn out an excess of competent people without really doing damage to this economy. If this sounds like I'm playing a conspiratorial string on my violin, hardly, the president of Columbia's teacher's college, Dean Russell, in 1908, in the keynote speech to the NEA, said that there was a tremendous danger that too many leader's would be produced, and it would cause a collapse in the system. "

If this is the tip of the iceberg of why we are at this point in history, because of a lack of collective critical thinking and the opinion of but several ill-informed educators, this should surely be the possibility as to why we're on an unsustainable path. This is surely the key to that reasoning. We have to re-learn how to educate and re-educate in the ways of the past, where individuals gained the qualities to think for themselves and most probably, out of the box.

Up and onward to Richard Heinberg and his excellent book 'The Party's Over', which I've read twice and now use as a reference point to many subjects he raises. I have a great deal of respect for his work and his voice and only wish I'd have had the chance to hear him live at this seminar below, just to gain a perspective on the audience reaction to his words :-

Richard Heinberg's Peak Everything :-

He leaves much of the current stock of books and authors cold, quite simply because he makes no bones of his subject and states clearly what he sees ahead. However, I'm going to make a bold statement in that I feel that James Howard Kunstler truly has a place on your bookshelf because, where Heinberg effected me in educating my mind with positive values as to what the future is yet to draw out painfully, Kunstler raised my fears indelibly to make action at a greater turn of speed. Kunstler carries weight with his passion at this seminar, that to me, quite possibly raised the bar a couple of notches :-

James Howard Kunstler: Speech on New Urbanism :-

From reading 'The Long Emergency', it allowed me to look again at some of the realities brought about by the sludge of progress we've patted ourselves on the back for over the last five generations. My Knowledge of Market Harborough is a case in point that has, on the surface, embraced the American Suburban ideal that Kunstler regards as heinous.

In the Doomsday Book, the history of Mk Harborough goes back beyond the 7th century and is (or was), as its name refers, a market town. It had a vast cattle market that was second to none within a thirty mile radius of its centre. It also had a string of independent shops that had eeked out a living for centuries, up and to the begining of the early 1990's. This microcosm survived well upto this point with generation after generation growing up and, with minimal building of houses, enabled this community to also keep the house prices to a minimum. Its stock in trade was a niche that helped maintain its independence; its wealth was not so much based upon its money orientation yet, most definately in its ability to produce a product.

As of the early 90's, as I mentioned earlier, several epidemics in Britain set around meat production, starting with the practice of feeding pigs to pigs and cows to cows brought about CJD (Creutzfeldt-Jakob Disease - A rare and fatal neurodegenerative disease), that cancelled out the British beef free-trade market for a number of years. This also caused the price and value of any remaining meat produce to plumit, creating both financial hardship and a re-direction for 'Harborians' to train in other areas of manufacture. This created a large influx of plastics manufacturers to be allowed to build their factories on green-belt pasture land close to the town centre.

In 1992, J Sainsburies (similar to Walmart in the USA) bought the cattle market land and gained licence to build one of its retail outlets. This opened in 1994 with a mixed reception by locals who felt cheated out of their independent futures.

Now, if you look at the ways and means of how money was made with the housing industry anywhere in the western world, it is said that if you can find out where companies such as Walmart, Tesco, Asda (etc) are building there new outlets, to gain a captive audience to use those shops, large housing estates (suburbia) will grow quickly alongside these establishments. Market Harborough was no different in this respect and, with the green-belt surounding pasture and crop land nolonger in place for growing food, building companies bought large tracts and built faceless and identicle two, three and four bedroom houses; each and every one based on no more than four near identical designs.

Of course, the A14 motorway (freeway) also had its links modified to connect Market Harborough to the main M1 motorway within no more than thirty minutes. This allowed a new breed of community (or lack of?) called the commuter.

Commuters helped to raise the prices of the houses built and aided a market in house building in Mk Harborough to grow 8 times the size it was at the turn of 1993. This also removed any chance for those farm working family offspring to purchase a house; in essence the community built over many many generations simply died. The main street became a home of strangers. The offspring, unable to afford this new standard of living have mainly migrated to the cities.

Along with the development of J Sainsbury, all of those independent shops could not compete and were laid empty for the most part, to the benefit of large corporations such as W H Smith (books), Boots The Chemist and any number of other major outlets, each and every one decrying their own take on what 'Progress' is about.

The above is but one example of hundreds across the swaithe of the UK .It has removed the independence of community and built an unsustainable oil-based land-mass that would be almost impossible to turn back into its original state. This is the point in a nut-shell that James Howard Kunstler is so impassioned about in his book 'The Long Emergency', for which I feel is an excellent companion to Richard Heinberg and his book 'The Party's Over'.

I think that the 'tricky future' you're refering to is difficult to guage as to its pace and speed. If we cut away most of what the media is stating as fact as though it were mainly manipulative posturing, my opinion is that we're further along into this crisis than is overtly evident. Gathering up some land in Somerset is one excellent and positive step yet, with the possibility of failure, I see Totnes and its transition town ideals to be a better option with the help and support of many likeminded individuals who can collectively 'Learn As They Go', passing unsulied knowledge that can be past on to others again and again. Rob Hopkins, who appears to be the key figure in this growing ideal was interviewed here :-

However, as something that could well work cheek-by-jowel with transitioning, I like this mans take in a suburban setting. All things are possible dependent upon the gravity alluded to :-

The old quotation "You can feed a man a fish and he will live for a day..." etc, holds dearly to me. I couldn't possibly have taken on this farm in Hungary without the help and support of my surrounding community, family and friends.

The ideas that your friend has about 'complete collapse' persuades me to believe that you could maybe both be correct, it is all about time-scale and historic future events coming into play. His idea that the CC is a 'bargaining stage for grief' and a 'delusion we could better do without' could well be seen in this light upon its surface. But it is in the growing community here that will (I hope?) break out into the mainstream and, by the looks of things, will do that admirably, and soon. Chris Martenson has been as benine as he possibly could to give this site the momentum that is required for others to write here and make report on our collective futures. If he were to use too much of the downsides of the future as a map toward that fact, less would be arriving here to partake. I believe the delusion is only in missing the true gravity of the information.

Now I'm looking up at what I've written and realised there's a great deal of it, so, I leave you to ponder...

I’m not sure I
completely understand the Gatto quote. Is he saying we under-educate people on
purpose so we don’t produce more bosses than workers? If so (and I hate to
sound cynical, because fundamentally I’m not), then is this such a surprise? The
education system is about producing individuals who will sustain the society
that pays for it. That means producing ‘workers’ and ‘bosses’ according to what
is needed in the workplace, not the individual’s ability or interest. A waste for
certain, but I think it’s mistaken to think the education system cares that
much about individuals

If that all
sounds too ‘Brave New World’, then that’s because it is. Huxley wrote BNW as a
satire, not as a piece of utopian science fiction. Interestingly (I think
anyway) it was written as a spoof on the utopian genre that was popular in the
late Victorian era. But buoyed by its success, he thought he’d better write a
serious and intentionally utopian novel and produced ‘The Island’, which few
people have ever heard of! Anyway BNW touched a nerve because it was a more
extreme and consciously designed version of what was clearly happening anyway.
The starving brains of oxygen to produce ‘deltas’ (I think) is a terrible
metaphor for how we shape the behaviour/brains of our children today through
exposure to certain educational materials. Same result, just a different
process. That’s what made people sit up and take notice.

I think the idea
of critical thinking is interesting as a way of countering misuses and abuses of
power. I start from the position that control is ever present and we can’t break
free from it. For me the most pressing and central issue is ‘how’ we can
develop effective counter control against the power exerted over us. The idea
that we are ‘free’ is a myth as we are always controlled at some level. Now
that’s not a problem as long as the control is balanced and non-abusive. The
challenge we face is how to build balanced and fair relations, rather than how
to be ‘free’. And I would extend this to not just human-human relations, but
human-everything relations. We need to be respectful and in balance with all of
nature, not just socially with one another (though that would be a good start).
I know you weren’t necessarily talking about ‘freedom’, I’ve just used that as
a frame of reference to try to understand how critical thinking would be of any
use. Am I off the mark?

Re. Socrates –
his quote reminds of the phrase, ‘Good leaders need good followers’. Not quite
the same, but the idea is that we are all responsible, not just those at the
top of the tree.

I’ll look up ‘The
Long Emergency’ shortly, right after I finish reading ‘Waterlog’ – a wonderful
antidote to modern life. It’s a meditation and reflective travelogue of a man
who swims water courses around the UK, quite brilliant.

Re Mk Harborough
– I couldn’t agree more. Society has chased short term pots of gold and illusions
and in the process lost sight of the important things, like community, locality
and fraternity.

Time scales of
collapse? It’s a tricky one. I vacillate between being relatively calm (like
when I last wrote) to being quite anxious that it could all happen soon and be
nasty too.

How much can you lift above your head? A fit grown man can, in all probability, lift 40kg and straighten his arms. Yet, how far could he comfortably carry that weight for a distance? one hundred yards; a thousand? What of ten tons? How long would it take to carry that weight, in varying shapes, a distance of five miles? This weight carrying is to shift wood to the home without the use of oil. How long would it take with conventional tools such as an axe and saw to cut and produce that wood for cooking and heating? In trully conventional terms, this takes five strong men, two chainsaws, two axes, a tractor, one large trailor and about eight hours to create the same. Without chainsaws, tractor and trailor, I have no idea how long it would take to collect four months worth of wood in preparation for winter. The best time is around March 1st here in Hungary, before the leaves start to grow, and the wood needs at least six months to season before use. A horse and trap could well be a useful tool, yet this needs feed for the horse and skilled tools to create and maintain the trap. These are the realities you face when owning a farm at a time when fossil fuels are in geological and political decline.

The wood also has to be navigated as the crow flies, this, across mud that can deepen up to your shins in wet weather; everything is structured here to season.

If a farmer were to look at the property we've bought, he would thumb his nose and tell you that you have no more than four years worth of trees (wood) to support you, and would advise planting five hundred sapplings if he knew about peak oil. He would also tell you that it will take 6+ years for the wood to be useable for fuel and that it would be adviseable to build a stock supply of at least 60+ tons of wood as a reserve against uncertainty; this before water and seedlings and pickling vegetables and stocking manure and maintaining food for any number of animals without going outside of your land to support them. These are realities that are enforceable to your sanity and future well-being in an uncertain world which has been the lifestyle here for generations, up until fossil fuel garnered the working peasant to take to the cities for a 'New' lifestyle on the back of oil.

I still fear on the likelyhood of war (when time permits), in all of its forms, that the world cannot support the size of population it presently carries without oil, and that for the largest majority of those that see other than what I visualise as the road we are on and the destiny we face, a great many people are not going to be perpendicular to the ground; a great many less than present numbers and positive thinking would suggest.

So, what of suburban living and community? Will it hasten your survival with a thousand neighbours, ten thousand neighbours, a hundred neighbours; five neighbours? Would the cities of the world be a place to live without a gun; without fresh water? What distance to a city or town would make life easier\harder, ten miles, twenty, fifty, a hundred? What is the ground-swell of reasoning when we live in the present world on the convenience of 'just in time' delivery and 'three meals from anarchy'?

How are your teeth? It is proven from history that many preventable deaths were caused by septicaemia, by abscess from poor hygiene and neglect. Cut yourself somewhere that bleeds profusely and you need a cool head and medical supplies, no ambulance to run red lights for you here...

These aren't my imaginings, they are my daily mantra of 'what ifs' from a man who has grown up in a land-of-plenty, who carries no political torch for anyone in mind and has been told again and again that he is well-read.

So, what is the past to do with our present if our future is so uncertain? We need live and awake people to carry the weight of the future of our species and maintain our offspring so that their future is a worthwhile one; we didn't give them the choice of the life we've given them, almost for selfish reasons, yet more that it is our driven need to leave our gene in the pool of life in creating them in our image as our fathers did for us.

What recognition could I give to the past and those misdemeanors that 'Huxley' wrote of in parody of 'Wells'? Soma was his drug of choice and, in reality, Prozac and Ritalin are the modern standard in my eyes. A depression in human beings, created upon a formula called society, that stultifies the genious within, builds ignorance for its perpetuation, yet is born upon something so unsustainable that it requires five planet Earths to maintain the illusion. If the 'Genius Within' could, in effect be emerged in youth with the spirit intact and unbridled, would order really be lost to a world built with too many chiefs and not enough indians, or is that not the illusion that we've already been sold?

John Taylor Gatto really did say that children are under-educated for a purpose. The striving of the man so held back by 'The System' in place and, in turn, the childs future with his place in society condemned or admired dependant on your take as to the success of fitting one round peg into one round hole; for those with rough edges like me, I pose a challenge, and always have. Does that liken me to a problem child that grew up indifferent? No, I've carried my burden just as others carry theirs, the difference is about levels of awareness. Values are taught, but are they understood? Nationalism has always made me feel the world was in a state of attrition when so much could be shared without borders, whether physical or in the mind; flag waving has never been my idea of a day out; colour and culture are there to embrace and nurture, not corrupt and control for profit; one way or another.

The system educates to the standard it wishes to create. A man in debt is a man too busy to fight for his control over that debt when soft soaped with an ever decreasing wage through inflation and taxation. Only when the descent is large enough and the debts beyond him; only when the workplace becomes a breeding-ground for reality and redundancy; only when the media tells the truth when it cannot; and then, and only then, when the policeman and soldier stand to question what they've come to represent, does the whole edifice gain a new voice; even then, the void left behind can still be filled with something ever less worth fighting for, and that is the attrition we've built while our eyes and ears were closed to reason.